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The 
Standard Oil 
Company~ 


By ELBERT HUBBARD 


Being a reprint from ‘‘The Fra” Magazine 


DONE INTO A BOOK BY THE ROYCROFTERS, AT 
THEIR SHOP, WHICH IS IN EAST AURORA, ERIE 
COUNTY, NEW YORK .% ANNO CHRISTI, MCMX 


Copyright 1910 


by 
Elbert Hubbard 


(i) 


The Standard Oil Company 


(We sg HE Standard Oil Company is an 
Sy American institution. 
The Standard Oil Company is the 
largest employer of labor in the 
world. In average times it gives work directly 
to more than eighty thousand men. Its daily 
payroll is more than one hundred fifty thousand 
dollars .% .% 
Most of its equipment is‘ the invention of 
Americans, and its best and highest-paid 
chemists and engineers are also Americans, 
although it has searched the civilized world 
for talent and skill. 
The Standard Oil Company is our largest 
exporter of American products. 


The money pumped into the United States 
%: 


oO 


It deals in an American product. 
It supplies this product in its 
various forms to consumers in 
every country in the world, 
except those countries which 
have passed prohibitory tariff- 
laws, and thus have barred 
competition, not being able to 
meet it. 


THE STANDARD OIL COMPANY 


from foreign countries for American products 
through The Standard Oil Company’s financial 
pipe-lines is over two hundred fifty thousand 
dollars a day. This money at once finds its way 
through all the channels of American trade .* 
Europe has oil-fields as extensive as those in 
America. There are also oil-fields in Persia, 
Bulgaria, Burma, Ceylon, Australia, New 
Zealand, parts of South America, and the 
Balkans. Yet The Standard Oil Company could 
send its products to all of these countries at a 
profit, if not shut out by a tariff. The competi- 
tion of the world fades before it, because it is 
organized on a scale and in a way that no 
foreign competitor is. 

It is organized on the American plan. 

In Oriental countries individual effort still 
largely prevails. In Italy, Spain and Egypt, 
wells are drilled by hand, and pumps are 
operated by digital process. The use of the 
‘“‘srasshopper connection-rod,’’ which pumps 
a dozen or more wells by the use of one engine, 
was recently forbidden in Turkey, because, 
forsooth, ‘“‘Allah is great and Mohammed is 
his prophet, and a pump like that will throw 

4 


THE STANDARD OIL COMPANY 


the Faithful out of work.’ @ The argument 
that the forty men thrown out of work could 
be used to a better advantage elsewhere met 
with a shrug of doubt, and the remark: “ Allah 
be praised, if they work at this, they will not 
have to work at that.” 
Capital and Investment 

HE Russian oil-fields are about as big 
& as those in America. The largest com- 
bination of capital under one management in 
the oil business in Russia is one million dollars 
and it is a wonderoski! There is not a single 
millionaire in Russia, outside of the Czar and 
the Grand Dukes, and they do not count, since 
their business is consumption and waste, and 
not production. 
The capital of The Standard Oil Company is 
one hundred ten million dollars. And very 
much adverse criticism has been brought for- 
ward because it pays forty million dollars 
annually in dividends, or, say, an interest on 
capital of forty per cent. 
This, like most half-truths, is misleading. The 
fact is that, while The Standard Oil Company 


is capitalized for one hundred ten million 
5 


THE STANDARD OIL COMPANY 


dollars, its investment in plant and equipment 
is about seven hundred million dollars. In 
figuring percentages, the per cent of dividends 
should be calculated on the assets, and not on 
the nominal capitalization. 
Think, say, of the Chemical National Bank! 
q It should also be noted that, while The 
Standard Oil Company pays forty million dol- 
lars a year in dividends, the amount it yearly 
pays out in wages is fifty millions. 
The yearly amount of its business is about 
eighteen hundred millions, so its profits on 
the business done are about two and one-half 
per cent. . 
The Standard Oil Company owns one hundred 
twenty iron tank-steamships that are employed 
in its foreign trade. 
It also owns ten thousand miles of trunk-line 
pipe-line, and eighty thousand miles of con- 
tributory or feeding lines. One small item of 
its assets is twenty thousand tank-wagons, used 
in supplying consumers. 
Oil property is subject to great deterioration, 
in the fact that wells are constantly growing 
dry, and districts may be producing actively 
6 


THE STANDARD OIL COMPANY 


today, and tomorrow may be dry holes. In 
such cases the pipe-lines are of so little value 
that they are often simply abandoned and no 
attempt is made to remove them. 

A Decentralized Industry 
HE.Standard Oil Company owns a con- 
trolling interest in about fifty refining 

companies. Most of these were organized by 
the Standard directly, but some of them were 
bought up, and their active managers retained 
on salaries. A few were organized for the pur- 
pose of selling out to the Standard. 

This decentralization is one of the chief reasons 
for the success of the Standard. It is on the 
order of the modern department-store, which 
is merely fifty, sixty or seventy stores in one, 
each under a competent general manager. 
Every department has its own complete system 
of bookkeeping, and must make a profit, or 
show a reason why. 

In the old way of merchandising, the life of a 
successful business was twenty years, then it 
went broke. There were leaks that could not 
be located, dead stock, dead wood, dead men 


who thought that they were alive, salesmen in 
7 


THE STANDARD OIL COMPANY 


a comatose state, extravagant buyers, and lime 
in the bones of the boss. The law of diminishing 
returns wrecks every big venture that is not 
decentralized, that is, divided up into water- 
tight compartments, so if one springs a leak 
all the damage that is done is to flood that 
particular department. The ship still floats. 
@ The General Electric Company has recently 
begun to decentralize, and so have most of 
the other big corporations. And all of these are 
simply following the lead of The Standard Oil 
Company .% .% 
Its Marvelous Organization 

an organization, The Standard Oil Com- 
ae is equaled by only one other institu- 
tion on Earth—and I’ll not tell you what that 
one is. If you do not know, the matter would 
not interest you, anyway. 
The success of The Standard Oil Company has 
turned on its selection of men and its service 
to the public, and not on its strength of capital. 
The capital came as a result—it was an incident. 
The men who manage The Standard Oil Com- 
pany at one time had no capita —they did, 


however, have brains and energy. “ All wealth 
8 


THE STANDARD OIL COMPANY 


is a result of labor, applied to land,” says Adam 
Smith. Later he added capital as a factor in the 
production of wealth. Modern economists add 
a fourth factor, and this is the most important 
of all—it is Enterprise. The French call it the 
service of the Entrepreneur. 
Ida Tarbell surely tells one great truth. It is 
this: ‘‘Even the elevator-boys in the Standard 
Oil offices are selected with an idea to their 
development.” 
The Result of Competition 

HE position of The Standard Oil Company 

in the commercial world is the result of 
competition. It is the natural result of a com- 
mercial struggle for existence. It is the survival 
of the fittest. People who hate a monopoly 
should reverence The Standard Oil Company. 
For the men who manage The Standard Oil 
Company went into a free-for-all field, and won 
their way to fortune with exactly the same 
tools and weapons that all of their competitors 
had. In this fight for business there was no 
favor asked nor given. And the battle was 
fought according to the established rules of 


the game. 
9 


THE STANDARD OIL COMPANY 


They have done to their competitors what their 
competitors were trying to do to them. Often 
after the fight these competitors found them- 
selves with money enough to live on in ease 
the rest of their days. Retired oil-merchants 
living in easy affluence in many sections are 
thick as fleas on a,dog—one result of, Standard 
Oil rapacity.' 

The New Business Ethics 
RACTICALLY, the world has been made 
over within twenty years’ time, and we 

have now a new business ethic. 

The error of some reformers is to try a man, 
according to present-day standards, for offenses 
committed in Eighteen Hundred Eighty-five. 
@ In that year I well recall how the firm for 
which I worked had a shipment of heavy 
chemicals arrive on the docks in New York 
from Liverpool. The goods had not been 
removed from the lighters before we had 
bids from three different railroads and two 
canal-lines to transport the shipments to 
Buffalo. The reduced bids came in the form 
of rebates for “cartage,’’ “lighterage,” “dock- 


age’? or “commissions.”? There was a strife 
Io 


THE STANDARD OIL COMPANY 


for traffic, and the company that gave the 
biggest rebate got the business. 

We bought in the lowest market, and sold in 
the highest. The railroads have but one thing 
to sell and that is transportation. All railroads 
then sold their transportation for as much as 
they could, and took what they had to. Every- 
body bought scalpers’ tickets, except those who 
rode on passes. I rode on passes, first because I 
was a big shipper, and the rule of the times was 
that big shippers must be favored. Later, I rode 
on passes because I pushed what you call “a 
virile pen’’—and admitted it. Reduced to 
simple terms, it was this: I wrote so well that 
I molded public opinion, and thus had the 
power to injure the railroads. Therefore I was 
retained, as it were, by these base monopolies, 
and supplied transportation. 

We called it “the courtesies of the road.’’.* 
I rode on passes until January First, Nineteen 
Hundred Seven. Did I then turn in my passes ? 
Oh, no! The passes were taken away from me 
—and they nearly had to give me ether to do it. 
Now, I pay my fare and am proud of it, if not 
a little boastful. 


II 


THE STANDARD OIL COMPANY 


Make-Up of The Standard 


HE Standard Oil Company is made up 

of graduates of the University of Hard 
Knocks. They have played the game according 
to regulation American rules, and they have 
won because they had the foresight, patience, 
quickness, courage, good cheer, economy, 
skill. The men who went down before them 
failed for lack of these American qualities 
—these qualities inculcated in our public 
schools, extolled in books, preached in sermons 
—the qualities that have made Americans 
supreme wherever they have had a fair field. 
The American invasion has been carried even 
to that dear ol’ Lunnon, whose underground 
railways have been rendered light, airy and 
safe through being electrified by American 
push, pluck and perseverance. 
Now, Americans as a people are fair—or at 
least we wish to be fair. When we judge Moses 
and Aaron we judge them according to the 
times in which they lived. And when the 
Great Agnostic wrote a lecture on the “ Mis- 
takes of Moses’? we resented the proposition 


that Moses was a rogue and a robber because 
I2 


THE STANDARD OIL COMPANY 


he made war on the Hittites, Ammonites, and 
Midianites. We invoked the statute of limi- 
tations by saying that these things happened 
over three thousand years ago, and besides, 
did not Moses lead the Children of Israel out 
of captivity? 
That is to say, we point to the Ten Command- 
ments and the moral code of Moses and all the 
good he did as a set-off to deeds doubtful 
according to present-day standards. Moreover, 
we refuse to abandon the history of Moses as 
written by himself and his friends, and accept 
that of the disciples of Gog and Magog. 
Vilification Rampant 

P to this time, or until very recently, 

The Standard Oil Company has declined 
to answer its assailants. Its managers have been 
so busy doing things that they have had no time 
to shake the red rag of wordy warfare. 
Their faith has been that their work would 
speak for itself. Usually, this is a wise policy, 
but in this instance I think it has been a mis- 
taken one. Silence has been construed into a 
plea of guilt. 


There is a time to speak and a time to refrain 
13 


THE STANDARD OIL COMPANY 


from speaking, says Ecclesiastes. The Standard 
Oil Company should have nailed a few of the . 
Ida Tarbell fairy-tales, ten years ago. 

Ida Tarbell is not a charter member of the 
Ananias Club—she is worse than that—she is 
an honest, bitter, talented and prejudiced 
person who wrote from her own point of view. 
@ And that view is from the ditch, where her 
father’s wheelbarrow was landed by a Standard 
Oil tank-wagon. 

To understand her book, it is not enough to 
read it—you must have a glimpse at the author. 
Ida Tarbell has twenty-three pictures of John 
D. Rockefeller in her book, but none of herself. 
Her own history is written between the lines, 
and her picture is on the fly-leaves. 

She shot from cover, and she shot to kill. Such 
literary bushwhackers should be answered shot 
for shot. Sniping the commercial caravan may 
be legitimate, but to my mind the Tarbell- 
Steffens-Russell-Roosevelt-Sinclair method of 
inky warfare is quite as unethical as the alleged 
tentacled-octopi policy which they attack .* 
q] There is a life of George Washington written 


by a Cockney who was born within sound of 
14 


THE STANDARD OIL COMPANY 


Bow Bells and who. was never farther away 
from Charing Cross than Hammersmith. We 
call Washington the ‘Father of his Country,” 
but this man calls him “‘arch-fiend’”’ and “a 
bloody, blooming rebel.” 

Recently, a man picked out of a file of the New 
York “Tribune” one hundred editorials on 
Lincoln. The intent was to reprint the Greeley 
editorials as a literary curiosity, but no pub- 
lisher could be found with stomach to stand 
for the joke—it was sickening. Yet, Greeley 
was an honest man. His attacks on Lincoln, 
like those on Wendell Phillips, represent a 
point of view, and a point of view which we 
now see was out of focus. 

Ida Tarbell is a great woman, but if she were 
to write my life, I’d take hers—with apologies 
to Ursa Major. She might tell in truth of how 
I stole watermelons, turned the cows into the 
corn, because I had a tiff with the owner’s 
daughter—sold a railroad-pass, rode on the 
bumpers, gave a false name to a policeman 
who had curiosity plus, made fun of my grand-. 
mother, and put a Smallpox sign on old Massa- 
chusetts Hall in Harvard Yard. 


15 


THE STANDARD OIL COMPANY 


Of course, that does n’t exhaust the list—there 
is still more to be told, which my kind neighbors 
will supply. 
A man’s friends never quite know all about him 
—they never fully analyze him. To know all 
about a person is the pleasing assumption of 
his enemies. 
The Square Deal 

OW, in the interests of the Square Deal, 

that thing of which we hear so much and 
see so little, if you tell of my faults and lapses, 
you should also tell of the good I have done. 
If my tank-wagon bumps into a wheelbarrow, 
you ought to give me the benefit of letting me 
tell where I was going, and how the accident 
happened. Perhaps I was on the right side of 
the road going carefully, and the wheelbarrow 
may have been exceeding the speed limit— 
who knows! 
A man in England once said to me: “Oh, what 
a pity that Rockefeller robbed and ruined the 
oil country—the destitution there must be 
terrible!” 
The man had been reading Ida Tarbell. 


Then I had to tell my friend that, while I 
16 


THE STANDARD OIL COMPANY 


did n’t know much about John D. Rockefeller, 
I was familiar with the oil country, and I knew 
that, since The Standard Oil Company had got 
a-going, there had been a steady growth of 
prosperity in the oil country, where before 
there was the fear of uncertainty, and all the 
doubt that disturbs, distresses and dissolves. 
I told him that The Standard Oil Company was 
not made up of gamblers—they were miners, 
producers, distributors and creators. 

Titusville, Oil City, Corry, Franklin, Olean are 
beautiful and growing cities where peace and 
plenty are the rule—cities of homes, schools, 
churches, stores, opera-houses and libraries— 
where good things were to be found in an 
abundance and to a degree never before known. 
@ Also, I told him that wherever the Standard 
Oil went it carried system, order, safety, 
prosperity; and that it paid a wage beyond 
its competitors, even beyond ‘Union Scale,” 
and absorbed the best and strongest into its 
ranks; that The Standard Oil Company met 
its obligations, never defaulted on its payroll, 
and supplied the world a high quality of goods 


at prices regarded as reasonable and right. 
17 


THE STANDARD OIL COMPANY 


Its offense lay in the fact that it had succeeded; 
and through the inappreciation and lack of 
understanding as to what a tremendously rich 
and bountiful country this is in which to live. 
What is History ? 

NE of the greatest books ever written 

by mortal man is Thomas Henry Buck- 
le’s ‘History of Civilization.” 
Buckle never got beyond the introduction, 
which forms a volume in itself, and is immortal 
on account of its wealth of logic and clearness 
of insight .% The whole volume is a protest 
against the way in which history has been 
written—a protest against the assumption that 
military history, a history of marches and 
countermarches, of skirmishes and fights, of 
sieges and slaughters, is history at all. 
Certainly it is not the history of the life and 
evolution of a people. That which makes or 
unmakes a nation is the quiet, peaceful, 
productive life of the people. Nations are 
great through their architects, engineers, 
artists, teachers, business men and workers, 
and not through their lawyers, preachers and 


policemen .% .% 
18 


THE STANDARD OIL COMPANY 


It is commerce—production and distribution 
—-that has given America her proud place 
among the Nations, not lawsuits .% Our 
supremacy lies in the one fact that “we 
have produced the goods.” And yet in reading 
Ida Tarbell you find thirty-six pages given to 
an account of a lawsuit with an outcome 
comparatively trivial in any event, and in 
which, as in most lawsuits, all parties lost 
out to the lawyers. Jaggers was the only 
man who won. 

To read Tarbell is to read history militant, 
as if nothing really happened in America 
between the time Jackson beat the British 
in Eighteen Hundred Twelve at New Orleans 
and the time Sumter was fired upon in Eighteen 
Hundred Sixty-one. 

The Tarbell history is a history of strife, of 
bickerings, of misunderstandings, of lawsuits 
—an infinite sez he, sez she, and sez I. It is 
over-the-back-fence gossip, raised to fortis- 
simo. For instance, the gifted author cites 
Commodore Vanderbilt as authority concern- 
ing the genius of John D. Rockefeller and 


his partners. She should first have read ‘‘ Moore 
19 


THE STANDARD OIL COMPANY 


on Facts,’’? wherein the credibility of witnesses 
is treated at great length. There she would have 
learned that, when she quotes Commodore 
Vanderbilt, in justice to the jury she should 
have stated that when Vanderbilt gave his 
testimony he was eighty-three years old, and 
moreover was talking of a man he had never 
met, and of a business concerning which he 
knew nothing. She should also have told that, 
even in his best days, Vanderbilt was of a most 
violent and prejudiced nature. 
Moore says that Pontius Pilate and Caiaphas 
. were both good men, but unsafe, unreliable 
and incompetent as witnesses. 
Commercial Sanity 

HIS country has just passed through a 

cyclone of defamation, vituperation and 
exposure—-much of it indecent. 
We have been in a state of panic through the 
policy of burning our barns to kill the mice. The 
national condition has been pathologic. 
We are now recovering our sanity. The com- 
mercial jolt we have experienced has shown us 
that when the railroads are prosperous—buying 


rails, extending their lines, building bridges, 
20 


THE STANDARD OIL COMPANY 


warehouses, collecting a better equipment—we 
are all prosperous. When the railroads cease 
pushing for better facilities, there is a lull, the 
bread-line forms, the tramp of the unemployed 
and the hoarse and ominous roar of the mob 
are heard in the land. In such times, an extra 
police force is needed and menace becomes 
imminent .% 2% 
Individuals at work are safe—and a nation 
is only safe when its people are employed. 
@ Now suppose you raise a cry of “Stop thief,”’ 
and turn the powerful resources of the govern- 
ment to harassing enterprise, with the endeavor 
to confiscate its property, take away its charac- 
ter, destroy its good-will, does it not stand to 
reason that we thus kill ambition, destroy 
initiative, smother aspiration, and get a con- 
dition where expansion ceases, orders are 
cancelled, men laid off, and th whole land 
suffers? 

Happily, however, we are now getting our 
nerves back to norm, and sanity will soon 
take the place of hysteria. 

We do business now according to Marquis of 


Queensberry Rules, when formerly London 
21 


THE STANDARD OIL COMPANY 


Rules governed the contest. Our fight is with 
six-ounce gloves. Horseshoes and railroad- 
spikes are barred. There was a time when we 
fought with bared knuckles. But business is 
not yet a ladies’ lunch—a suave and innocuous, 
harmless, tabby Four-o’clock. It is a struggle 
for supremacy. And it is a fight to a finish .% 
And it is just as full of romance as were the 
knightly jousts of old. 


The Utility of Wealth 

ONEY is the measure of power, but 
5 hid money for its own sake is not worth 
the struggle. Modern millionaires do not hoard 
—they invest. And they invest that they may 
use. The successful man now always has the 
builder’s itch—he is always and forever widen- 
ing, extending, building, improving, and it is all 
in the line of human service, human better- 
ment. To exploit Society is to fail, and wise, 
successful men know it. 
Nothing is more silly and absurd than the 
idea that the men who have built up the 
great modern American fortunes are intent 
on ease and luxury. As a class they are men 


of abstemious habits, simple, rapid and direct 
22 


THE STANDARD OIL COMPANY 


in their dealings. They work sixteen hours a 
day. They are in the game and can’t get out 
of it if they would. Their millions are invested 
in a way that makes use an imperative neces- 
sity. To liquidate would be red ruin. “They 
say I am rich,’’ once said James J. Hill to 
me, “and the yellows roll off the number of 
my millions. The fact is, I owe more money 
than all the men in Minnesota. To make my 
investments profitable and to keep them from 
fading away, I am obliged eternally to struggle 
keeping them active.” 
One investment calls for another to protect it; 
so Mr. Hill is ever building, ever extending. This 
eternal unrest of business means national pros- 
perity .% .% 
Confidence and Business Stability 
E habit of certain newspapers of trying 
to inspire class hatred by picturing the 
great business-builder as a parasite, living on 
the labor of the proletariat, is an insult to the 
intelligence of the age. 
Should our Government begin to confiscate 
private property in the name of the law, that 


instant will enterprise grow old, and senility 
23 


THE STANDARD OIL COMPANY 


prate of the past. @ But this is not to be .»% 
We are beginning to realize that business is 
built on confidence, that when we destroy 
faith in our commercial fabric we are actually 
taking the roofs from homes, snatching food 
from children, and pushing bodies naked out 
into the storm. Business means homes, gardens, 
books, parks, music, good roads, schools— 
safety, peace and prosperity—and of these 
things the world has not yet seen a plethora. 
@ Shall we blast, wither and destroy with the 
breath of our mouths all that civilization holds 
dear? I think not. We can direct and regulate, 
but we will do it in justice and not in blindness 
and wrath, lest we welcome the angels of peace 
with bloody hands to hospitable graves, and we 
ourselves go down in the sunken roadway, 
horse and rider, pursuer and pursued. 


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